I really need help on these problems for my study guide for the final and this i

Question

I really need help on these problems for my study guide for the final and this is my last post :(

Calculate Lead Time Orion Devices Inc. is considering a new just-in-time product cell. The present manufacturing approach produces a product in four separate steps The production batch sizes are 76 units. The process time for each step is as follows: Process Step 1 Process Step 2 Process Step 3 Process Step 4 The time required to move each batch between steps is 12 minutes. In addition, the time to move raw materials to Process Step 1 is also 12 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 12 minutes The new just-in-time layout will allow the company to reduce the batch sizes from 76 units to 5 units. The time required to move each batch between steps and the inventory locations will be reduced to 2 minutes. The processing time in each step will stay the same Determine the value-added, non-value-added, total lead times, and the value-added ratio under the present and proposed production approaches. If required, round percentages to one decimal place 7 minutes 5 minutes 4 minutes 9 minutes Value-added time Non-value-added time Total lead time Value-added ratio (as a percent) Present Approach Proposed Approach 25 min 60 X min 25 min 84X min min min

Explanation / Answer

PRESENT min

PROPOSED

min

VALUE ADDED

25

25

NON VALUE ADDED

60

30

TOTAL LEAD TIME

85

55

VALUE ADDED RATIO

25/85

29%

25/55

45%

PROCESS A/C

$

$

DM 1250 X $140

175000

RF TO FG

445000

CC

270000

445000

445000

RIGHT NOW

$

$

SALES 1220 X $330

402600

DM 1250 X $140

175000

CC

270000

445000

LESS: CLOSING STOCK

445000/1250 X 30

-10680

434320

LOSS

31720

BUDGETED CELL CONVERSION COST PER HOUR = 445000/1800 = $2472

BUDGETED CELL CONVERSION COST PER UNIT = 445000/1250 = $356

JOURNALS

$

$

DEBIT

CREDIT

RAW MATERIAL INVENTORY

175000

ACC PAYABLE

175000

CONVERSION COST ( PROCESS A/C)

270000

CASH

270000

WIP

175000

RAW MATERIAL

175000

FINISHED GOODS

445000

WIP

445000

COST OF SALES

445000

FINISHED GOODS

445000

ACC REC

402600

SALES

402600

INVENTORY (FG)

10680

INCOME SUMMARY

10680

RETAINED EARNINGS

31720

INCOME SUMMARY

31720

TRADITIONAL min

LEAN

min

VALUE ADDED

11

11

Non value

9

0

total

20

11

VAR

11/20

55%

11/11

100%

1.    ORION

PRESENT min

PROPOSED

min

VALUE ADDED

25

25

NON VALUE ADDED

60

30

TOTAL LEAD TIME

85

55

VALUE ADDED RATIO

25/85

29%

25/55

45%

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

---